Requesting Entity: Department of Budget and Management
Issues Concern: Surety Bond as Warranty Security for the Procurement of Motor Vehicles
Request for exemption from Section 62.1 of the Revised Implementing Rules and Regulations (IRR) of Republic Act (RA) 9184, particularly, on the acceptable forms of warranty provided therein by allowing the acceptance of surety bonds.
Please note that the acceptable forms of warranty security in the procurement of goods are limited to retention money and special bank guarantee. Surety bond s a form of warranty is acceptable in case of infrastructure projects. Thus, following the principle “expression unius est exclusion alterius”, the specific inclusion of retention money and special bank guarantee as acceptable forms of warranty security for the procurement of goods implies the exclusion of other forms of warranty security not mentioned. In this regard, we are of the view that a surety bond cannot be considered an acceptable form of warranty security for the procurement of goods.